A man bought 260,000 #Bitcoin for $0.01 each
His exchange ERASED the trade
The TRAGIC STORY of Kevin Day, who lost $16 billion in the biggest crypto rollback in history 👀
Kevin Day was a 1990s geek from Nebraska, video game developer
In his spare time, he worked on the internet.
When his startup closed in the Dot-Com Crash, he went on hosting websites.
That’s what attracted him to #Bitcoin – he loved the freedom of web culture.
He joined #Bitcoin when the price was $7
BTC was on a tear – up from $0.30
He was frantically trying to mine BTC
Then, on June 19, 2011 – he got the opportunity of a LIFETIME
BTC CRASHED from $17 to $0.01 –– in just 20 minutes
While others were freaking out, he took action.
He bid to buy $3,000 worth of #Bitcoin .
The price? $0.0101
He bought 259,684 BTC for UNDER $3,000
When the price bounced back – it was a 166,000% gain
the $5 MILLION he made
But his luck didn’t last long
The flash crash was due to an exchange hack – a hacker had stolen the coins, then sold them to crash the market.
Mt. Gox quickly announced it would "roll back" the trades.
It wasn't a great time to hold your btc on an exchange.
A week earlier, Mt. Gox. reported 25,000 BTC stolen
The exchange was now blaming THEIR OWN AUDITOR!
A rollback meant all trades after the hack would be canceled – including Kevin's
Other buyers who put in legitimate orders – buying hundreds of #Bitcoin for PENNIES… saw 0 BTC balances.
Now, before the roll back, Kevin made a small withdrawal
Of the 260,000 he bought, he withdrew 643 BTC – the most allowed by the exchange's own policies
He believed his trade was legitimate.
In Kevin’s mind, he wasn’t responsible for his exchange’s security.
Mt. Gox never refunded any individuals who were hacked
Ultimately, Mt. Gox would do what was in its best interest – erasing all the trades.
Kevin lost 259,360 #Bitcoin
But he learned a valuable lesson – never leave your coins on an exchange
